Cheques might not be scrapped after ministers accused banks of failing to come
up with a convincing alternative.

Charities, small business and campaigners have been outraged at plans by the Payments Council to end cheque clearing from October 2018.

However Mark Hoban, the Financial Secretary to the Treasury, said that cheques could not be scrapped until “a suitable alternative is found”.

In a letter to Andrew Tyrie MP, the chairman of the Treasury select committee, he said: “Until this is demonstrated, I do not believe that there is a credible and coherent case for abolishing cheques.”

Ministers would “intervene… if there is any threat that cheques may be withdrawn without suitable alternatives being put in place at all”, he said.

Last year, 620million payments were made by cheque, compared with 6.29billion by debit card, and 1.88billion by credit card.